Laws, Regulations & Annotations

Property Taxes Law Guide – Revision 2014
 

Revenue and Taxation Code

Other Taxes

Part 6.7. Documentary Transfer Tax Act

CHAPTER 3. Exemptions


Chapter 3. Exemptions

11921. Instrument to secure a debt. Any tax imposed pursuant to this part shall not apply to any instrument in writing given to secure a debt.

11922. United States; state or territory; District of Columbia. Any deed, instrument or writing to which the United States or any agency or instrumentality thereof, any state or territory, or political subdivision thereof, is a party shall be exempt from any tax imposed pursuant to this part when the exempt agency is acquiring title.

History.—Stats. 1969, p. 2101, and p. 2138, in effect November 10, 1969, amended this section to provide for exemption when the exempt agency is acquiring title.

11923. Conveyance incident to plan of reorganization or adjustment. (a) Any tax imposed pursuant to this part shall not apply to the making, delivering, or filing of conveyances to make effective any plan of reorganization or adjustment—that is any of the following:

(1) Confirmed under the Federal Bankruptcy Act, as amended.

(2) Approved in an equity receivership proceeding in a court involving a railroad corporation, as defined in Section 101 of Title 11 of the United States Code, as amended.

(3) Approved in an equity receivership proceeding in a court involving a corporation, as defined in Section 101 of Title 11 of the United States Code, as amended.

(4) Whereby a mere change in identity, form, or place of organization is effected.

(b) Subdivision (a) shall only apply if the making, delivery, or filing of instruments of transfer or conveyances occurs within five years from the date of the confirmation, approval, or change.

History.—Amended by Stats. 2006, Ch. 538 (SB 1852), in effect January 1, 2007.

11924. Conveyance pursuant to order of the Securities and Exchange Commission. Any tax imposed pursuant to this part shall not apply to the making or delivery of conveyances to make effective any order of the Securities and Exchange Commission, as defined in subdivision (a) of Section 1083 of the Internal Revenue Code of 1954; but only if—

(a) The order of the Securities and Exchange Commission in obedience to which such conveyance is made recites that such conveyance is necessary or appropriate to effectuate the provisions of Section 79k of Title 15 of the United States Code, relating to the Public Utility Holding Company Act of 1935;

(b) Such order specifies the property which is ordered to be conveyed;

(c) Such conveyance is made in obedience to such order.

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11925. Transfer of partnership interest. (a) In the case of any realty held by a partnership or other entity treated as a partnership for federal income tax purposes, no levy shall be imposed pursuant to this part by reason of any transfer of an interest in the partnership or other entity or otherwise, if both of the following occur:

(1) The partnership or other entity treated as a partnership is considered a continuing partnership within the meaning of Section 708 of the Internal Revenue Code of 1986.

(2) The continuing partnership or other entity treated as a partnership continues to hold the realty concerned.

(b) If there is a termination of any partnership or other entity treated as a partnership for federal income tax purposes, within the meaning of Section 708 of the Internal Revenue Code of 1986, for purposes of this part, the partnership or other entity shall be treated as having executed an instrument whereby there was conveyed, for fair market value (exclusive of the value of any lien or encumbrance remaining thereon), all realty held by the partnership or other entity at the time of the termination.

(c) Not more than one tax shall be imposed pursuant to this part by a county, city and county or city by reason of a termination described in subdivision (b), and any transfer pursuant thereto, with respect to the realty held by a partnership or other entity treated as a partnership at the time of the termination.

(d) No levy shall be imposed pursuant to this part by reason of any transfer between an individual or individuals and a legal entity or between legal entities that results solely in a change in the method of holding title to the realty and in which proportional ownership interests in the realty, whether represented by stock, membership interest, partnership interest, cotenancy interest, or otherwise, directly or indirectly, remain the same immediately after the transfer.

History.—Stats. 1999, Ch. 75 (AB 1428), in effect January 1, 2000, added "or other . . . tax purposes" after "a partnership", and substituted "the partnership . . . the following occur" for "a partnership or otherwise if—" after "an interest in" in subdivision (a); substituted "The partnership . . . as partnership" for "Such partnership (or another partnership)" before "is considered", and substituted "1986" for "1954" after "Revenue Code of" in paragraph (1), substituted "The" for "Such" before "continuing", and added "or other entity treated as a partnership" after "partnership" in paragraph (2) of subdivision (a); added "or other . . . purposes," after "of any partnership", substituted "1986" for "1954" after "Revenue Code of", substituted "the partnership or other entity" for "such partnership" after "part," , substituted "the" for "such" after "realty held by", added "or other entity" after "partnership" and substituted "the" for "such" after "at the time of" in subdivision (b); substituted "a partnership . . . as a" for "such" after "realty held by", and substituted "the" for "such" after "at the time of" in subdivision (c); and added subdivision (d).

11926. Instruments taken in lieu of foreclosure. Any tax imposed pursuant to this part shall not apply with respect to any deed, instrument, or writing to a beneficiary or mortgagee, which is taken from the mortgagor or trustor as a result of or in lieu of foreclosure; provided, that such tax shall apply to the extent that the consideration exceeds the unpaid debt, including accrued interest and cost of foreclosure. Consideration, unpaid debt amount and identification of grantee as beneficiary or mortgagee shall be noted on said deed, instrument or writing or stated in an affidavit or declaration under penalty of perjury for tax purposes.

History.—Added by Stats. 1971, p. 804, in effect March 4, 1972. Stats. 1973, Ch. 645, p. 1188, in effect January 1, 1973, added "from the mortgagor or trustor as a result of or" after "taken", deleted "a" before "foreclosure", where it first appears, added the rest of the first paragraph thereafter, and added the second paragraph. Stats. 1974, Ch. 413, p. 1003, in effect January 1, 1975, added the second sentence, and deleted the former second paragraph regarding the establishing of entitlement to the exemption.

11927. Division of assets between spouses pursuant to judgment or agreement. (a) Any tax imposed pursuant to this part shall not apply with respect to any deed, instrument, or other writing which purports to transfer, divide, or allocate community, quasi-community, or quasi-marital property assets between spouses for the purpose of effecting a division of community, quasi-community, or quasi-marital property which is required by a judgment decreeing a dissolution of the marriage or legal separation, by a judgment of nullity, or by any other judgment or order rendered pursuant to the Family Code, or by a written agreement between the spouses, executed in contemplation of any such judgment or order, whether or not the written agreement is incorporated as part of any of those judgments or orders.

(b) In order to qualify for the exemption provided in subdivision (a), the deed, instrument, or other writing shall include a written recital, signed by either spouse, stating that the deed, instrument, or other writing is entitled to the exemption.

History.—Added by Stats. 1981, Ch. 985, in effect January 1, 1982. Stats. 1992, Ch. 163, in effect January 1, 1993, substituted "the Family Code" for "Part 5 (commencing with Section 4000) of Division 4 of the Civil Code" after "pursuant to" in subdivision (a).

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11928. Conveyance by State or political subdivision; immediate reconveyance to exempt agency. Any tax imposed pursuant to this part shall not apply with respect to any deed, instrument, or other writing by which realty is conveyed by the State of California, any political subdivision thereof, or agency or instrumentality of either thereof, pursuant to an agreement whereby the purchaser agrees to immediately reconvey the realty to the exempt agency.

History.—Added by Stats. 1987, Ch. 301, in effect January 1, 1988.

11929. Conveyance by State to nonprofit corporation; financed by obligations issued by nonprofit corporation on behalf of governmental unit. Any tax imposed pursuant to this part shall not apply with respect to any deed, instrument, or other writing by which the State of California, any political subdivision thereof, or agency or instrumentality of either thereof, conveys to a nonprofit corporation realty the acquisition, construction, or improvement of which was financed or refinanced by obligations issued by the nonprofit corporation on behalf of a governmental unit, within the meaning of Section 1.103-1 (b) of Title 26 of the Code of Federal Regulations.

History.—Added by Stats. 1987, Ch. 301, in effect January 1, 1988.

11930. Inter vivos gift or by reason of death. Any tax imposed pursuant to this part shall not apply to any deed, instrument, or other writing which purports to grant assign, transfer, convey, divide, allocate, or vest lands, tenements, or realty, or any interest therein, if by reason of such inter vivos gift or by reason of the death of any person, such lands, tenements, realty, or interests therein are transferred outright to, or in trust for the benefit of, any person or entity.

History.—Added by Stats. 1996, Ch. 862, in effect January 1, 1997.

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